China’s New Foreign Investment Push: 15 Measures and What They Mean for Global Investors
Services sector opening, financial liberalization, and pharmaceutical innovation are creating new opportunities. Here’s what global investors and multinational corporations need to know.
1. Current FDI Landscape: Stabilizing with a Quality Shift
In the first half of 2026, China attracted 402.14 billion yuan in actual utilized foreign direct investment (FDI), down 5% year-on-year — but the decline is narrowing significantly. May and June both recorded positive year-on-year growth, signaling a clear stabilization trend. The decline narrowed by 10.2 percentage points compared to the same period last year.
The quality of FDI is improving dramatically. High-tech industries attracted 170.33 billion yuan in H1 2026, up 33.2% year-on-year, accounting for a record 42.4% of total FDI — up 12.2 percentage points from the same period last year. Within high-tech:
According to the Ministry of Commerce, nearly 4,800 foreign-funded enterprises increased their investment in China in the first half of 2026. China’s stock of FDI has now reached approximately $4 trillion, with over 530,000 foreign-funded enterprises employing more than 30 million people and contributing about 2.5 trillion yuan in annual tax revenue.
2. The 15 Measures: A Five-Pronged Strategy
On June 22, 2026, the Ministry of Commerce, together with the National Development and Reform Commission and the Ministry of Finance, jointly issued the “Action Plan for Stabilizing and Optimizing the Use of Foreign Capital” (商资发〔2026〕97号). The plan was developed by 27 government departments working together, focusing on issues most relevant to foreign-invested enterprises.
The Action Plan consists of 15 specific measures across five areas:
- Services sector opening
- Vocational training & universities
- Financial services liberalization
- Pharmaceutical cross-border production
- Bio-tech & wholly-owned hospitals
- Merger & acquisition rules
- Cross-border data flows
- Reinvestment incentives
- R&D center support
- “Invest in China” brand
- Digital investment platform
- Local government guidelines
- Policy commitment enforcement
- National treatment for FDI
- Government procurement access
- Consumer campaign participation
- Online rights protection
- Digital information systems
- Streamlined reporting
- Information sharing
- Foreign exchange & permits
The Action Plan represents a major policy shift: with manufacturing sector foreign investment restrictions now fully eliminated, the focus has moved decisively to services sector opening.
3. Sector-by-Sector Opening: Where the Opportunities Are
The Action Plan targets three areas where foreign investors have the strongest interest and where institutional friction has been most acute: services, finance, and pharmaceuticals.
Education
New OpeningThe Action Plan calls for steadily expanding pilot programs for foreign investment in vocational training institutions, vocational schools, and high-level universities in science, engineering, agriculture, and medicine.
This builds on 2024 pilot openings in bio-technology, value-added telecommunications, and wholly foreign-owned hospitals, extending the opening model to the education sector for the first time.
Finance
Risk Management ToolsKey measures include:
- Support more foreign institutions to use risk management tools including treasury bond futures
- Allow foreign institutions to legally conduct fund investment advisory services
- Optimize cross-border business management and provide cross-border financing facilitation quotas for key foreign enterprises
- Guide domestic banks to offer “agency document preparation” international settlement services to large foreign firms
- Support qualified key foreign enterprises in listing and financing on China’s domestic exchanges
💡 These provisions upgrade financial sector opening from “permission to enter” to “infrastructure for operational capabilities.”
Pharmaceuticals & Healthcare
Cross-Border ProductionFour major initiatives:
- Cross-border segmented production: Implementing rules for drug segmented production, allowing overseas drug license holders to conduct segmented production of biologics and chemical drugs across borders — meaning production stages can be distributed across different countries and regions
- Expanding pilot zones: Bio-tech pilots currently cover Beijing, Shanghai, Guangdong FTZs and Hainan FTP; wholly foreign-owned hospital pilots cover 9 locations including Beijing, Shanghai, Tianjin, Nanjing, Suzhou, Fuzhou, Guangdong, Shenzhen, and Hainan — with further expansion under review
- Insurance coverage: Supporting insurers to include more innovative pharmaceuticals and medical devices in commercial insurance coverage
- Retail access: Facilitating entry of foreign-invested pharmaceutical products into retail channels
💡 The cross-border segmented production provision is particularly significant — it positions China not merely as a sales market but as an efficient node in the global compliant production network.
Telecom, Internet, Culture
Ongoing ExpansionThe Action Plan calls for orderly expanding opening in telecom, internet, education, culture, and medical care, with careful implementation of pilot openings in value-added telecommunications, bio-technology, and wholly foreign-owned hospitals. The government will time the reduction of the foreign investment negative list appropriately, giving foreign enterprises “wider space” to invest in China.
4. Why Services Matter: The New Frontier
The emphasis on services is not arbitrary. Services now account for 70% of China’s actual utilized FDI — and the share continues to grow.
China’s services trade is shifting from scale expansion to quality upgrading. Knowledge-intensive, high-value-added services are seeing rapidly improving international competitiveness.
In H1 2026, modern services accounted for 57% of total FDI. This is where the policy momentum and market demand are strongest.
The Action Plan also explicitly supports foreign enterprises in participating in China’s consumption stimulation campaigns, including consumer goods trade-in programs, tax refund schemes, and international consumption center development. As Commerce Vice Minister Ling Ji put it: “Consumption stimulation has become a new track for foreign investment in China.”
5. What Global Investors Should Do Now
The Action Plan opens up genuinely new opportunities in sectors that were previously off-limits or heavily restricted. Here’s how to position yourself:
Education (vocational training, universities), finance (fund advisory, treasury futures), and pharmaceuticals (cross-border production, wholly-owned hospitals) are now genuinely open for business. First-movers will have significant advantages.
New sectors mean new partner ecosystems. Verifying the credentials, financial health, and compliance track record of potential local partners is essential before making any commitments.
The Action Plan emphasizes data cross-border management, national treatment, and fair competition. Ensure your corporate documents, certifications, and compliance materials are properly authenticated and ready for China’s regulatory environment.
The “K-shaped” divergence in China’s economy means not all potential partners are equally positioned. Thorough due diligence — including legal standing, financial health, and operational history — is essential for navigating the new landscape.
While the Action Plan opens new doors, it also requires careful navigation. Different sectors have different pilot zones, timelines, and qualification requirements. Partner verification and compliance preparation are not optional — they are essential to success. The opportunity is real, but it rewards the prepared.
The 15-measure Action Plan represents a decisive policy shift from manufacturing to services-led foreign investment opening. With education, finance, and pharmaceuticals now open for business, the opportunities for global investors are substantial and growing. The key is understanding the sector-specific rules, finding the right local partners, and conducting thorough due diligence. Those who move now will be best positioned to capture value from this new wave of China’s opening.
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